Preliminary U.S. GDP data

• GDP (q/q) (Q4), fact 2.6%, forecast 2.6%.
• GDP deflator (q/q) (Q4), fact 2.0%, forecast 1.7%.
• Initial jobless claims, fact 225K, forecast 221K.

Preliminary data on the US GDP for the 4th quarter were very positive, despite general negative dynamics of the US GDP. The main positive note of the report was the GDP deflator, which unexpectedly accelerated in the 4th quarter, pointing to the growth potential of inflation and the US economy. Relatively weak data on the number of initial claims for unemployment benefits is very restrained. Despite the growth, this indicator remains within the limits of the existing error, near multi-year lows.

Fig. 1. U.S. GDP deflator (q/q) (Q4) chart

The US dollar index and the US state bonds yield accelerated the growth on a very optimistic data. It should be noted that the dollar index versus the basket of competitors continues to be traded in a downtrend, limited to resistance 96.20-30. With the preservation of positive sentiment on the dollar and renewed pessimism, it is possible further strengthening of the American dollar to resistance 96.50. But the overall downward trend in the dollar is likely to limit the growth.

Fig. 2. The US dollar index. The current price is 96.10 (10-year government bonds yield is the blue line)

Read also: “Government Bonds as a Market Driver”

Hanzenko Anton

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